[alt.religion.computers] Free market vs Central planning

nelson@sun.soe.clarkson.edu (Russ Nelson) (12/29/89)

In article <72@zds-ux.UUCP> gerry@zds-ux.UUCP (Gerry Gleason) writes:

   If this alternative does seem a little like socialism, you can consider
   how to decide which contribution is more important than another and
   reward that author with some type of bonus.  The way I see it, private
   software companies (often small enough to avoid bureaucratic stupidity)
   often are not all that good at making the rewards commencerate with
   the contribution, so why shouldn't rewards be arbitrary.  Maybe you
   could set up contests that awarded additional prizes to the best works.

I agree, Gerry.  Almost everyone agrees that the government should
have a hand in the physical infrastructure.  Why not have a hand in
the software infrastructure?  Some people object to this, claiming
that the free market is better than central planning.  If the free
market is so efficient and capable in bringing goods to market, then
why don't companies use the free market internally?

[note followups]

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bob@MorningStar.Com (Bob Sutterfield) (12/29/89)

In article <NELSON.89Dec28205458@image.clarkson.edu> nelson@sun.soe.clarkson.edu (Russ Nelson) writes:
   If the free market is so efficient and capable in bringing goods to
   market, then why don't companies use the free market internally?

Some do.  Many companies are structured as federations of divisions
with weak central control and division heads operating very much like
classical entrepreneurs.  The internal free market operates by lower
echelons "selling" their ideas to those higher in the heirarchy, in
competition with other ideas for finite resources and attention just
as the company or division as a whole sells to its consumers.

Such companies are more flexible than the typical monolith, and able
to interact more quickly to the market.  They are often models of
success.  Then, because of their remarkable growth, they hire ex-IBM
managers and grow an overabundant middle management, and start filing
lawsuits...

peter@sugar.hackercorp.com (Peter da Silva) (12/30/89)

> If the free
> market is so efficient and capable in bringing goods to market, then
> why don't companies use the free market internally?

Some do.  Universities, for instance, use the market to  allocate
central  computing  resources.   They don't use the feedback from
the market to purchase  new  resources,  which  distorts  things.
Also,   almost   any  company  that  has  subsiduaries  allocates
resources to the subsiduary and gives it considerable free  rein.
Smaller units, though, are a different matter.

Central planning still works on a small  enough  scale.  It  just
doesn't scale up very well.

-- 
Peter "Have you hugged your wolf today" da Silva <peter@sugar.hackercorp.com>
`-_-'
 'U`  "I haven't lost my mind, it's backed up on tape somewhere"

gordon@spiff.uucp (Gordon A. Runkle) (12/31/89)

In article <NELSON.89Dec28205458@image.clarkson.edu> nelson@sun.soe.clarkson.edu (Russ Nelson) writes:

   I agree, Gerry.  Almost everyone agrees that the government should
   have a hand in the physical infrastructure.  Why not have a hand in
   the software infrastructure?  Some people object to this, claiming
   that the free market is better than central planning.  If the free
   market is so efficient and capable in bringing goods to market, then
   why don't companies use the free market internally?

I think the reason companies don't generally use the free market
internally, (and note that many do, to an extent) is a matter of
granularity.  The idea is to deal with things at the most
decentralized level.  This provides for many approaches to a given
problem, and greatly facilitates development of new ideas.

--
Gordon A. Runkle                        UUCP:  uunet!men2a!spiff!gordon
Management Information Consulting, Inc.          HOME PH:  703-522-0825
2800 Shirlington Road,  Suite 1220               WORK PH:  202-566-4382
Arlington, VA  22206

Overheard at a funeral:  "I know this may be an awkward time, but do you
recall him ever mentioning source code?"
     -- Charles Addams
-- 
Gordon A. Runkle                        UUCP:  uunet!men2a!spiff!gordon
Management Information Consulting, Inc.          HOME PH:  703-522-0825
2800 Shirlington Road,  Suite 1220               WORK PH:  202-566-4382
Arlington, VA  22206

jmann@bigbootay.sw.stratus.com (Jim Mann) (01/03/90)

>Central planning still works on a small  enough  scale.  It  just
>doesn't scale up very well.

The reverse is also true: the free market, which works very well on a large
scale, does not work best on a very small scale (inside of a company
unless the company is very big).